Gap, Inc. (GPS) Tops Q1 EPS by 16c

Gap, Inc. (NYSE: GPS) reported Q1 EPS of $0.01, $0.16 better than the analyst estimate of ($0.15). Revenue for the quarter came in at $3.28 billion versus the consensus estimate of $3.29 billion.

GUIDANCE:

The company is estimating second quarter net sales could decrease in the mid to high-single digit range compared to last year's net sales of $3.86 billion. As a reminder, the sale of Gap China to Baozun Inc. closed on January 31, 2023. Second quarter 2022 net sales included approximately $60 million in sales for Gap China.

The company continues to anticipate that fiscal 2023 net sales could decrease in the low to mid-single digit range compared to last year\'s net sales of $15.6 billion. As a reminder, fiscal 2022 net sales included approximately $300 million in sales for Gap China. Fiscal 2023 will include a 53rd week estimated to positively impact net sales by $150 million.

The company expects second quarter and fiscal 2023 gross margin expansion compared to the prior year. At the estimated level of sales described above, the company is planning adjusted SG&A of approximately $1.3 billion in the second quarter and continues to anticipate approximately $5.2 billion for fiscal 2023.

The company now expects fiscal 2023 capital expenditures in the range of $500 million to $525 million, compared to its prior range of $500 million to $550 million, reflecting lower capital project investments and fewer Old Navy and Athleta store openings than previously contemplated.

For earnings history and earnings-related data on Gap, Inc. (GPS) click here.

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